Citibank Adjusts High-End Prestige Card. Again.

There’s a continuing battle in the credit card business of benefits versus rewards. Some card companies, like American Express, offer you great benefits for having the card, but not as much in the way of rewards when you actually use the card. Chase, on the other hand, focuses more on offering great rewards when you spend money using its products. And then there’s Citibank, which can’t seem to make up its mind.

Citi Changes Prestige, And It Looks Better

Citibank launched its high-end Prestige card several years ago to compete with Chase’s Sapphire brands and American Express’s Platinum. The problem for Citi was that they didn’t have a ton of experience competing in the luxury business, and initially produced a product that was so lucrative for customers that the bank couldn’t afford to maintain it. So, being Citibank, they did the only thing that they could think to do. They gutted it. It wasn’t terrible, since they kept two of the best benefits (fourth night free on any hotel stay, $250 airline credit, Priority Pass lounge access), but it made a difference.

And now, Citibank is making some major changes again, with the new set of benefits slated to begin in January, when it starts issuing cards again. Many of these are positive, so let’s take a look.

The Good

Rewards for spending are going up. You will now receive five points for every dollar spent on dining or air travel. This is up from three, and represents a new high in the industry. Hotel travel stays at three points. This is huge. You can convert these points to miles on several carriers, so they’re worth racking up.

The $250 airline credit will now become a general travel credit, which is good for any form of travel, not just air travel.

The Bad

The annual fee is going up $45, to $495.

They’re eliminating the 25% bonus you get for spending points through Citi’s travel portal. It was good while it lasted.

The Ugly

This will only affect some of you, but for those it does hit, it’s big: Currently, you get the fourth night free on any hotel booking you make through Citi’s travel agency. The bank is now limiting that benefit to 2X per year. That means that if you take a lot of multi-day trips, you could be losing out on some substantial rebates.

Overall, I think the changes are positive, particularly with the upgrade to the rewards. If you are a frequent traveler who uses the “fourth night free” benefit, though, it’s definitely a downgrade.

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